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The letter statest that they are seeking payment from me to recover the arrears, currently over £1,000, as I have failed to respond to Lloyds TSB’s requests for payment. This is not entirely true, as with all of my creditors, I never shy away from answering their calls or informing them of my situation.

I have written to Lloyds TSB and informed them that I cannot afford the debt, I have even offered them a full and final settlement on it as I cannot imagine I will ever be able to afford the debt on my current earnings.

In this letter, it states that if I do not immediately forward a payment to Lloyds TSB, Sechiari Clark and Mitchell (solicitors) may commence legal proceedings against me.

According to the Law Society website, these solicitors are not registered, they have no results for them in their database of solicitors. According to the Solicitors Regulation Authority website, they have no record of this solicitors firm either. This makes me a bit suspicious, are they a real solicitors firm or are they just debt collectors pretending to be solicitors?

I would have thought that in an area of business that is regulated such as law is, the two main bodies that keep a register of regulated law firms should have this firm listed on their website. I’m happy to be proven wrong, but at the moment I cannot find any trace of this firm being a genuine solicitors firm.

Just as a bit of a sanity check, I searched for the solicitors firm that I used for my divorce and found them listed in the Law Society website, so the search facility does seem to work and contain useful results. I have sent in a request to the Law Society for them to put my fears to rest that the law firm does actually exist, so I should get a response from them soon.

I will update with a follow up to this post when I hear back from the Law Society.

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As I’ve already stated to Barclaycard in writing, I cannot afford to make the minimum payments on my cards as I’m not earning much money, so instead am paying a small amount each month so that they always receive some form of payment.

As a result of my not having responded to these various text messages, I got a phone call on Thursday evening from Mercers Debt Collections, who are dealing with my accounts on behalf of Barclaycard. I spoke to a very nice woman who was quite sympathetic to my reasons why I couldn’t afford the normal payments on my cards and she said they may be able to offer me a settlement figure.

Now given that last month (October) I had already settled one of my Barclaycard accounts for around 30% of the balance, I was expecting this lady from Mercers to be aware of that figure, and come up with something similar for the accounts she was dealing with – I have two remaining Barclaycard accounts, one was a Sky card that was transferred to Barclaycard.

After discussing with her manager for five minutes, she came back with figures for each account. I wasn’t massively impressed – she was only offering a 20% discount on each account – this would still leave me needing to find 80% of the balance, a figure I just don’t have access to.

I explained that I would politely decline the offer, and she then stated that I should try and get onto a professionally managed debt management plan, and she gave me a number for a company.

I asked her then when the accounts would be passed to Calders Financial, as they were the debt collections agency I dealt with on the settlement last month. She stated that as the account was only three months in arrears, it would be another three months before it was passed to Calders, and so the waiting begins…

If you would like some professional advice about your debts, I can recommend using one of these guys. They will give you a FREE no obligation consultation which should give you an insight into what solutions are available to you and what it will cost.

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An in-house debt collection agency is simply a different department of a lender that deals with delinquent accounts – accounts that have stopped paying their repayments under the agreement – and may have a different name than the lender to give the customer the feeling that they are dealing with an external organisation. In some cases, the in-house debt collection agency will be in the same building as the lender, so very much in close contact with the lender having up-to-date information on the account.

An independent debt collection agency is an external firm that either buys the bad debt from the lender for a percentage of it’s face value. This can be as low as 7% as I wrote about in What Is The Value Of Your Debts To A Debt Collection Agency?, although sometimes they work on commission, receiving a bounty which will be based on the amount of the debt they are able to recover.

In either case, debt collection agencies will typically attempt to force customers to pay back debts that they may not be able to afford, and in some cases using tactics that are neither ethical or legal.

The important thing to remember is that for debt collection agencies they are simply performing a business function, and so they will not be emotionally involved with your situation so don’t expect any sympathy when dealing with them. The way to deal with them is to maintain a certain amount of professionalism and pragmatism, ensuring that you state your case clearly for what you can afford and trust that they will be reasonable in their approach too.

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Anyway, I digress a little. I have been unable to pay my Barclaycard accounts since July 2008 when my business went belly up. Since then I have had all sorts of phone calls from Barclaycard, text messages and from what I’ve read on various forums, unenforceable default notices served against me.

What generally happens is that once your account goes into arrears, the account is passed over to Mercers, who are in the same office as the Barclaycard staff, or so I have been told by someone who used to be a debt collector and knows the business inside out.

Mercers then deal with the account, and to be fair are persistent, they rang incessantly for weeks before I eventually spoke with them and told them that I could not afford the full payments.

I eventually did have a six month spell when I could pay 1% of the balance under a quasi debt management plan, though all it was really was a short term (six month) agreement with my creditors to stop interest while I was getting my finances back together.

After this period, I then couldn’t afford to go back to paying even the 1% as my income had taken another hit, so I wrote to them, in fact all of my creditors, and told them that I could only afford about £80 a month between all of them.

This was not acceptable to any of my creditors, so I just started paying it anyway. This went on for a couple of months, I had more default notices sent to me and more phone calls, but by this time I’d become oblivious to it.

Then I had a breakthrough, middle of October I had a phone call from a very nice, polite woman who was from Calders Financial, acting on behalf of Barclaycard.

I spoke with her and she informed me that she may have a solution that would stop the phone calls, but it required me making a lump sum payment.

Bingo! A full and final settlement offer, initiated by the creditor, or at least their representatives.

I made her an offer of about 20%, she came back with nearer 40% and we settled someone between the two, slightly in my favour if I recall.

I then had her spin me a double glazing salesman’s line that the offer was only valid for that day and if we couldn’t get the funds to them by 3pm that day, the offer would not be available after that, and it would most likely cost us more to settle in future.

Clearly rubbish, if the debt is only worth x today, and then in three months time, after there has been no income on it, it’s worth less, simple economics.

I was able to settle the debt that day, but before I did, I demanded that they produce an offer of full and final settlement to me in writing before I paid over any money. Call me skeptical but I don’t trust these people, and certainly wouldn’t want to pay over a lump sum, just to find that the next month I received a statement showing that I had paid off some of my debt but the rest remained.

They claimed they couldn’t email any written offer over, but could fax something, so I gave them our fax number and it arrived after about 10 minutes. I then settled after I had written proof, and as yet have not had any other proof from them to say the debt is settled, so I await my next statement date with interest!

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